Cable Technology Feature Article
Cablevision Reports 4Q Net Income Gains Due to Bresnan Acquisition
By Tracey E. Schelmetic, TMCnet Contributor
Cablevision Systems Corp., has reported that its fourth quarter net income rose by 45 percent, due in part to its purchase of Bresnan Communications as well as organic growth in its phone and Internet customer base.
The company, which is the U.S.'s fifth-largest cable provider, reportedly added a net 271,000 basic cable subscribers during the quarter to bring the total to about 3.3 million. It's important to note, however, that with the Bresnan acquisition taken out of the mix, Cablevision would have actually lost 35,000 basic cable customers. By acquiring Bresnan, the company added customers in Montana, Wyoming, Colorado and Utah to its existing New York-area operations and customer pool, reported the Associated Press (News - Alert).
Cablevision's earnings rose to $114 million, or 38 cents per share. That's up from $78 million, or 26 cents per share, a year earlier. Analysts polled by FactSet (News - Alert) were expecting 44 cents per share. Revenue rose about six percent to $1.87 billion from $1.77 billion. These figures were close to the $1.85 billion analysts had been expecting.
Cablevision stock fell 98 cents, or 2.6 percent, to $36.44 in morning trading.
In addition to a net gain of 271,000 basic cable subscribers, the company added a net 190,000 digital cable customers and 140,000 telephone customers. In these cases, too, Bresnan added hundreds of thousands of customers. Without these customers gained by the acquisition, Cablevision would have reported losses in the New York area.
Cablevision also reported 14 percent revenue growth from Rainbow, which owns pay TV channels such as AMC, Sundance and WE TV along with the IFC suite of independent film production entities.
In December, the company's board approved a plan to spin off Rainbow Media, creating two separate companies -- one focused on the provision of cable TV signals and hook-ups and another focused on programming. The spin-off will reduce Cablevision's debt by about $1.25 billion.
For the full year, the company earned $361 million, or $1.20 per share, compared with $286 million, or 96 cents per share, in 2009. Annual revenue rose to $7.23 billion from $6.85 billion.
Cablevision will pay a quarterly dividend of 12.5 cents per share on March 21 to shareholders of record on Feb. 28. That's the same dividend the company issued in the most recent quarter.
Tracey Schelmetic is a contributing editor for TMCnet. To read more of Tracey's articles, please visit her columnist page.
Edited by Tammy Wolf